Business

New York, Oct 12 (AP/UNB) — U.S. stocks sank more than 2 percent Thursday, the second day of steep declines around the globe driven by concerns about rising interest rates and trade tensions that could slow economic growth.

The Dow Jones Industrial Average fell 545 points after dropping 831 points Wednesday. The two-day loss of 5.3 percent is the biggest for Dow since February. The S&P 500 is also down more than 5 percent over the two days and after falling for the past six trading days is almost 7 percent below its Sept. 20 high.

The recent turbulence in financial markets is a contrast to what investors have grown accustomed to in a bull market that has lasted more than 10 years, the longest in history. A hallmark of the past decade has been ultra-low interest rates, which the Federal Reserve used to promote growth in the aftermath of the 2008 financial crisis.

The Fed has been gradually raising interest rates over the past two years, after not having increased them since the recession. Those higher rates have been the catalyst for recent selling, stoking concerns that slower growth would impinge on corporate profits.

The selling Thursday was widespread. Energy companies sank along with oil prices and CVS lead a rout in health care stocks. Technology companies and retailers, including longtime market favorites Apple, Alphabet and Amazon, extended their recent slide.

"There isn't much of a place to hide right now in the equity market," said Willie Delwiche, an investment strategist at Baird.

Seeking safety, investors bought gold and government bonds. That pushed bond prices up and their yields down, ending a surge in yields that had touched off the market's current decline. But investors found more things to worry about.

There are ongoing concerns about the unresolved trade dispute between the U.S. and China, the world's second-biggest economy.

Strong earnings reports in the coming weeks could soothe investor nerves, but negative comments from company executives about future profits could have the opposite effect. Recently a larger-than-normal number of companies have warned that their third-quarter results could be weaker than analysts expected.

The benchmark S&P 500 index rose in morning trading, but ultimately gave up 57.31 points, or 2.1 percent, to 2,728.37, its lowest close in three months. The index has declined 6.7 percent during its current losing streak. That's its steepest downturn since a 10-percent drop in early February.

The Dow Jones Industrial Average lost 545.91 points, or 2.1 percent, to 25,052.83 after falling as much as 698. The Nasdaq composite skidded 92.99 points, or 1.3 percent, to 7,329.06. The Russell 2000 index of smaller-company stocks fell 30.03 points, or 1.9 percent, to 1,545.38.

Thursday's losses in the U.S. followed steep declines overseas. Markets in France, Britain and Germany fell after stocks declined sharply in Hong Kong and Japan.

"People are trying to get a sense of 'where should my money actually be right now?'" said JJ Kinahan, chief market strategist for TD Ameritrade.

The S&P 500's current decline is the longest since a nine-day skid shortly before the 2016 presidential election. It has climbed 27.5 percent since Donald Trump was elected and is still up 2.1 percent in 2018.

The market had been calm from late June through September as investors were satisfied with continued economic growth, strong company profits, and signs of progress in trade talks between the U.S. and several partners, even as the U.S. remained at odds with China.

But traders have grown more uneasy about the U.S.-China trade dispute, which has been escalating. Washington has imposed tariffs on tens of millions of dollars of Chinese exports and Beijing has responded with similar retaliatory taxes on imports of U.S. goods.

And there are indications that China's economy has begun to cool, prompting its government to take steps to stem the slowdown in economic growth. China's stock market is in a steep slump, with Hong Kong's Hang Seng index down more than 15 percent this year.

Delwiche, the Baird strategist, thinks the current U.S. market slump isn't over yet.

"I don't see evidence right now that this is a one-off event," he said.

On Thursday, President Trump renewed his criticism of the Federal Reserve, blaming the recent downturn in the stock market on the Fed's rate policy.

"We have interest rates going up at a clip that's much faster than certainly a lot of people, including myself, would have anticipated. I think the Fed is out of control," the president said to reporters in the Oval Office.

Trump said he had no intention of firing Jerome Powell, who he appointed as Fed chairman in February.

Bond prices rose as the recent surge in yields attracted the attention of some investors. The yield on the 10-year Treasury note fell to 3.15 percent from 3.22 percent late Wednesday. That's still sharply higher than it was about a week ago, and earlier this week the yield on the 10-year note reached its highest level since mid-2011.

The drop in yields hurt banks, and JPMorgan Chase fell 3 percent to $1078.13 while Bank of America sank 3 percent to $28.36. JPMorgan Chase and several other banks will report their third-quarter results Friday morning.

Technology and retail companies continued to stumble. Amazon dropped another 2 percent to $1,719.36 and Apple fell 0.9 percent to $214.45. Microsoft and Alphabet, Google's parent company, were little changed. Those stocks have made huge gains for years, but they're currently out of favor. Amazon and Alphabet, respectively the second- and fourth-most valuable U.S. companies, are in what's known as a "correction," a drop of more than 10 percent from a recent peak. Facebook, the sixth-largest company, has tumbled 29 percent since late July, surpassing the 20-percent threshold for a "bear market."

The Nasdaq composite has fallen 9.6 percent since it set a record high in late August and the Russell 2000 has fallen 11 percent.

Dhaka, Oct 11 (UNB) - International Finance Corporation (IFC), a member of the World Bank Group, has invested $20 million as a long-term loan in Omera Petroleum, a subsidiary of MJL Bangladesh Limited, to help the company double its capacity and increase the availability of liquefied petroleum gas (LPG), especially in rural areas.

Omera, whose parent MJL is majority owned by the Bangladeshi conglomerate, East Coast Group, is the second-largest player in Bangladesh’s LPG market by volume, said the IFC in a statement on Thursday.

The IFC loan is part of its project to double its capacity and make LPG available in nearly all sub-districts of the country.

This will expand access of LPG to 350,000 additional households (around 12 percent of the total market potential) over the life of the loan.

It will also help reduce greenhouse gas emissions by substituting kerosene, wood, and other hazardous cooking fuels, and allow the limited reserves of natural gas to be diverted to power generation and industries.

Declining natural gas supplies have prompted the Government of Bangladesh to promote LPG as a major source of primary energy.

The government aims to supply LPG as cooking fuel for 70 percent of households within the next three years.

It has also been promoting LPG usage in vehicles as an alternative to compressed natural gas CNG) and bulk LPG for industrial purposes.

“IFC is committed to delivering clean energy to all people in Bangladesh,” said Wendy Werner, IFC Country Manager for Bangladesh, Bhutan and Nepal.

“Omera’s expansion will enable businesses and families across the country to switch from biomass energy to clean LPG fuel for cooking and commercial activities. LPG makes positive development impact in Bangladesh’s energy mix. We laud the Government’s stance to promote privatization of LPG sector to create a resilient energy sector.”

Bangladesh is a low-income International Development Association (IDA) country.

IFC's country strategy for 2017-21 – while addressing other key development gaps – focuses on increasing access to electricity, and diversifying energy sources. This project will enable the end users to switch to a much cleaner and efficient fuel.

“Omera has made great socio-economic contribution across Bangladesh by delivering the largest volume of LPG using our state-of-the art infrastructure across urban & remote areas”, said Tanzeem Chowdhury, Head of Corporate Planning and Business Development.

He said this is the beginning of a long term partnership between IFC and East Coast Group to finance and build larger projects that will help achieve our Group objective to provide easy access of green fuels and clean energy to every district of Bangladesh.

Access to energy and diversification of fuel are two critical bottlenecks in the growth trajectory of Bangladesh. In the last five years, IFC has invested about $800 million to remove these obstacles. This is IFC’s first investment to promote LPG in Bangladesh, said the statement.

Dhaka, Oct 11 (UNB)- Local electronics giant, Walton is going to invest 10 million US dollars in television production at its own factory to manufacture best quality products for customers home and abroad.

A conference of Walton plaza managers on Thursday disclosed the matter at its corporate office in the city.

SM Mahbubul Alam, Director of Walton Group, inaugurated the daylong conference titled ‘Meet the Plaza Managers & Exchange View 2018’ where more than 300 managers from different parts of the country along with high-officials of Walton were present.

Speaking on the occasion, SM Nurul Alam Rezvi, Chairman of Walton Hi-Tech Industries Ltd. said that “Walton is not only conducting business in Bangladesh but also in the whole world. It is now an international brand. Walton is manufacturing world-class products using best raw materials at its own production plant equipped with latest technology and machineries.”

Vice Chairman SM Shamsul Alam said “Walton has been providing best products and services to customers since its inception. Walton tops the VAT payer list in Dhaka international trade fair every year. Few days ago, Walton received National Environment Award and recently honored with Export Excellence Award.”

Speaking on the occasion chief guest SM Mahbubul Alam said “All customers are equally important. Ensuring customer satisfaction by providing best quality products and services is our main goal. So, the Plaza managers need to be sincerer.”

At the ceremony, the best Plaza Managers of different zones were rewarded. The daylong function ended with a pleasant cultural program.

Dhaka, Oct 11 (UNB) - Asian Development Bank (ADB) Country Director Manmohan Parkash on Thursday said ADB’s new procurement policy is a paradigm shift towards faster and more effective implementation of ADB-assisted projects in Bangladesh.

“The policy will help reduce the overall procurement time and transaction costs, improve quality of procurement, promote advanced and cleaner technologies, encourage deeper focus on project design and planning, and infuse more flexibility and dynamism in the bidding process allowing multiple stage bidding for complex procurement,” said Parkash.

The ADB explained its new procurement policy at a ceremony at Bangabandhu International Conference Center in the city.

The new policy, for which guidance notes were issued in 2018, emphasizes two new principles----‘quality’ and ‘value for money’ along with the existing principles of economy, efficiency, fairness, and transparency, ADB said.

Currently, ADB has 96 loans and grants for 56 projects with over $10.1 billion under sovereign portfolio in Bangladesh.

ADB’s portfolio performance in Bangladesh is expected to hit the highest record in 2018 while it has grown by 300 percent since 2008.

ADB focuses its cooperation in Bangladesh in six sectors—energy; transport; water and urban/municipal infrastructure and services; education; finance; and agriculture, natural resources, and rural development.

ADB’s cumulative lending to Bangladesh stands at around $22 billion for 284 loans, $263 million for 435 technical assistance projects, and $922 million for 41 grants.

Nusa Dua, Oct 11 (AP/UNB) — The heads of the World Bank and IMF on Thursday urged the U.S. and China to play by world trade rules and de-escalate a dispute over Beijing's technology development strategy that threatens to do lasting damage to the global economy.

Christine Lagarde, managing director of the International Monetary Fund, said she would advise Beijing and Washington to cool down, fix aspects of the world trading system that need fixing and "don't break it."

Lagarde and World Bank President Jim Yong Kim spoke separately on the sidelines of the lenders' annual meeting in a resort zone of the tropical Indonesian island of Bali. The event brings together finance ministers and central bankers from many economies, amid tight security: a line of armed personnel carriers were lined up alongside a beach path and access to the area was tightly controlled.

Asked about the escalating dispute between the U.S. and China, Lagarde said that so far there had been no "contagion" of major damage from penalty tariffs imposed by the two countries on each other's exports, but that they do risk hurting "innocent bystanders."

Lagarde said her advice was in three parts: "De-escalate. Fix the system. Don't break it."

The rules-making World Trade Organization, based in Geneva, has ways of addressing U.S. complaints that China's policies unfairly extract advanced technologies and put foreign companies at a disadvantage in its push to dominate certain industries, she said. But she added that the WTO does need to work on addressing issues like subsidies.

"Our strong recommendation is to escalate work for a world trade system that is stronger, that is fairer and is fit for the purpose," she said in opening remarks.

Lagarde also, somewhat obliquely, said policies aimed toward an excessively "dominant position" were not compatible with free and fair trade.

Earlier in the week, the IMF downgraded its global economic outlook, forecasting growth will be 3.7 percent this year rather than its earlier estimate for 3.9 percent growth. It also issued reports on government finance and financial stability that warn of the risks of disruptions to world trade.

Kim said the World Bank was working with developing countries to prepare for a further deterioration. If tariffs were imposed to their most extreme limits there would be a "clear slowdown and the impact on the developing countries would be greater," he said.

"Trade is very critical because that is what has lifted people out of extreme poverty.

"I am a globalist. That is my job. That is our only chance of ending extreme poverty. We need more trade not less trade," he said.

Kim said the bank had offered help to Indonesia for its recent earthquake and tsunami and other disasters. The people gathered in Bali for the meetings got a taste of such hazards themselves with an overnight earthquake that shook hotels in the resort area cordoned off for the event. Indonesian officials said the worst damage occurred on Java island. There was no evidence of severe damage in the area near the finance meetings.

Bali, a popular tourist destination, reflects both the positive and negative aspects of Indonesia's own rapid development over the past three decades — Lagarde praised the democratic, Muslim-majority country of 260 million for making huge progress in improving its finances and fostering strong growth.

But the byproducts of the tourist boom in largely Hindu Bali have been significant inequality and environmental damage.

The annual meetings take place at a time of growing concern over trends other than trade, such as moves to raise borrowing costs in the U.S. and some other regions to help cool growth and keep inflation in check. Rising interest rates are drawing investment flows out of emerging markets in Asia and Latin America at a time when growth in their exports is likely to slow.

Argentina and Pakistan are among countries grappling with potentially destabilizing financial woes. Concerns are growing, also, over slowing growth in China and rising debts among some developing countries resulting from projects associated with Beijing's "Belt and Road Initiative" to develop ports, roads and other infrastructure.

On Monday, Pakistan Finance Minister Asad Umar said the country would seek a bailout loan from the IMF to address its mounting balance of payments crisis.

Asked about whether such help might amount to a "bailout" for Chinese loans, Lagarde said she had not yet seen a formal request for help but thought she might receive one later in the day when meeting with Umar. Any such help would have to be completely "transparent," she added.

"In whatever work we do we need a complete understanding and complete transparency about the nature of a debt that is bearing on a country," she said.

Leaders of Southeast Asian nations were also gathering in Bali for finance-related meetings, as finance ministers of the Group of 20 industrial nations and officials from the Group of 24 developing economies. The meetings include sideline events staged by non-governmental organizations.